Rental tax declaration

R

raglan

Registered User
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Hi
I have a question about what tax rate is correct to declare on rental income?
Situation is shortly I will be part landlord on an inherited house, 25% share that is gifted to me. I am married. I have been looking into possible rental income (after taxable expenses took into account). I am in the 20% tax band. So say I have €4,000 rental income, do I pay tax at 20% on it or does my salary be added to my husbands who earns about 79k gross…so pushes us into higher rate bracket…so does that mean I pay 40% tax rate on rental income even though share of house is in my name. Another question is another part landlord lives abroad , is tax rate always 20% for non resident landlords?
 
You need to get legal and tax advice on this as to how best to proceed.

Being a landlord is not for the fainthearted these days. It is difficult and complicated enough without having four involved. Who decides who the tenant will be? Who is responsible for all the documents that have to be filed on the tenant and with the RTB 100% correctly and within strict time limits to avoid penalties and criminal prosecution. Who will look after things if the tenancy goes wrong ie. non-paying tenant who is damaging the place etc. Also, is everybody's long term plans the same. You will be locked into the tenancy for at least 6 years, is everybody happy with that, are you all happy to take the risk that you may not be able to get vacant possession to sell or that it may be impossible to meaningfully increase the rent in 6 years time.

Take a look at some of the other threads on here to see the extent of what you are getting yourself involved in.

Same for the tax advice. I think there will be tax withholding at least for the tax abroad.
 
raglan said:
Another question is another part landlord lives abroad , is tax rate always 20% for non resident landlords?
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A non-resident landlord is supposed to be subjected to a withholding tax by the tenant of 20% of the gross rent. However, that landlord may still be entitled to some tax credits and deductions so may ultimately be due a refund from Revenue (assuming the withholding has been applied). Where that landlord has other assessable Irish income (e.g. ARF distributions), civil service pensions, then they may owe tax at a higher rate.

 
raglan said:
Another question is another part landlord lives abroad , is tax rate always 20% for non resident landlords?
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Yes, until you reach the higher rate, which won’t be the case here. They don’t have any other income in Ireland like an Irish state pension?
 
raglan said:
Situation is shortly I will be part landlord on an inherited house
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Why on earth would you get into this scenario? Is this a “keeping the family home for sentimental reasons” scenario? If yes, don’t.
 
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